What Janet Yellen will do with the nation's purse

In fact, many people who know her say those points sum up a prominent part of Yellen's persona: She's ultrasmart but also ultramethodical – wanting to think through problems from every angle and with an open mind.

"She was brilliant and a hard worker," says Lois Hedberg, a classmate and friend from those days at Fort Hamilton High School in Brooklyn, N.Y. "I don't think she ever just got along on brilliance."

Her thorough, skip-no-detail approach will be tested in the years ahead as Yellen begins a four-year term scheduled to start at the end of January. Arguably no individual will have more influence over financial conditions for American families. She can't pull the levers of monetary policy all alone, but Fed chiefs traditionally have wielded substantial influence guiding the course of everything from interest rates to the regulatory climate for US banks.

And Yellen, appointed by President Obama to succeed Ben Bernanke, arrives at a crucial time. The central bank today is playing an unusually large role in efforts to revive the economy, because the rest of Washington is mired in partisan gridlock.

"The Fed is the only game in town," says Alice Rivlin, a Brookings Institution scholar who served as Fed vice chair during the Clinton era.

For Yellen, that will mean navigating a difficult course from the moment she occupies the head chair in the Fed's ornate conference room in Washington: trying to move the economy toward more solid growth while also backing the central bank off its stimulative policy of holding short-term interest rates at zero. This will affect everything from unemployment to inflation to stock market portfolios.